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China Q3 GDP pips past forecast

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BEIJING:Oct 20, 2015, Reuters,

Oct 19 2015, 23:36pm ist

updated: Oct 19 2015, 23:36pm ist

China's economic growth eased to 6.9 per cent in the third quarter from a year earlier, beating expectations but still the slowest since the global financial crisis, putting pressure on policymakers to roll out more support measures as fears of a sharper slowdown spook investors.

Analysts polled by Reuters had predicted growth in gross domestic product (GDP) for the world's second-largest economy would grow by 6.8 per cent, compared with 7 per cent in the prior quarter.

Quarter-on-quarter growth was 1.8 per cent, the National Bureau of Statistics said at a news conference on Monday. The market had expected GDP growth to come in at 1.7 per cent on a quarterly basis, compared to a revised reading of 1.8 per cent the prior quarter.

Consumption accounted for 58.4 percent of China's gross domestic product (GDP) in the Jan-Sept period, while capital formation accounted for 43.4 percent, a spokesman for the National Bureau of Statistics told reporters on Monday.

Net exports trimmed 1.8 per cent from the GDP in the first nine months of this year, Sheng Laiyun said.

China's economic growth eased to 6.9 per cent in the third quarter from a year earlier, beating expectations but still the slowest since the global financial crisis, putting pressure on policymakers to roll out more support measures as fears of a sharper slowdown spook investors.

China's government has fixed a growth target of around 7 per cent for 2015 but that seemed increasingly at risk after a raft of weak data over the summer. Beijing's surprise currency devaluation on August 11 and a 40 per cent plunge in the country's stock markets also added to fears of shocks to the world's second-largest economy.

Even if the seven per cent target is attained it would mark the slowest growth in a quarter of a century as activity is weighed down by weak exports, factory overcapacity, a soft property market, high debt levels, a government anti-corruption campaign and slowing investment. The economy grew 7.3 per cent in 2014. Chinese leaders have been trying to reassure global markets that Beijing is able to manage the world's second-largest economy after the shock devaluation in the yuan and summer stock market crash sparked fears of an economic hard landing. Some market watchers believe real growth is already much weaker than official data suggest.

Oliver Barron, China policy researcher, NSBO, Beijing, said: “The GDP beat is surprising, given that the monthly FAI and industrial production figures slowed considerably, and much faster than expected. The data would suggest that retail sales is holding up the data and there are other areas that the government is factoring in consumption and services data that are not picked up in the monthly figures.”

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